Although the U.S. economy officially emerged from recession twenty-six months ago, most Americans report that they believe there has been little or no growth and 75% believe the nation is headed down the economic wrong track. The “Great Recession” of 2007 to 2009 was the longest since the Great Depression and was the first time U.S Gross Domestic Product actually fell in any year since 1948. Unemployment according to the Labor Department peaked in October 2009 at 10.1% and then declined to 9% last month. But this statistic does not include those unemployed who have been out of work for so long they no longer “participate” in registering for unemployment benefits. As shown below; labor force “participation” shrank by 2% since 2009. Add in these jobless and real unemployment rate is at a record 11% right now:

The stimulus that has recently been driving GDP growth is a provision contained in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. This tax incentive allows businesses to book 100 percent “bonus depreciation” for any qualified capital expenditures purchased and taken delivery by December 31, 2011. This explains why the industrial production index has jumped back up to its average level for the last 40 years. The good news is businesses substantially increased capital investments in everything from $25,000 new Ford cars to $335 million Boeing 747 airplanes. The bad news is that business investments are being pulled forward into 2011 and 2012 suffer an off-setting fall in demand. Next year the U.S. economy will surprise on the down-side and unemployment will be on the upswing.

To fund spending increases on salary and pension benefits during the Great Recession; state and local governments raised taxes so much the effective percentage of all taxes paid by the average household in America jumped from 17.5% to 17.9%. This $247 billion tax increase more than off-set the stimulus effects of the last year’s federal payroll tax cut stimulus; but was not enough to prevent the lay-off of over 900,000 workers. But with voters in revolt and tax collection falling; state and local governments will cut spending this year for the first time since 1944.

Federal spending increased by 17% and the national debt ballooned by 55% since 2008. But voter rejection of deficit spending in 2010 and this year’s credit downgrade of the United States have forced Congress to cut federal spending for the first time since 1948. The recent deficit- reduction budget passed by Congress and signed by the President requires Congress to negotiate $1.5 billion of cuts, or the sequestration will require $1.2 trillion of cuts over the next 10 years. Federal Reserve Chairman Ben Bernanke stated in his last press conference: “I’m dissatisfied with the economy – unemployment is far too high”. He went on to state that “unemployment will remain above 7.8% through December 2013”. This is coded Fed speak for – watch out!

The last time on Election Day that America had declining government spending and rising taxes was 1948. That economy was growing by 2.6% and unemployment was only 3.8%. Twelve months later; growth had ground to a halt and unemployment more than doubled to 7.9%. I forecast America will soon be in recession and unemployment will rise into the 2012 election.

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Thank you all the success of Chriss Street’s latest book: “The Third Way”; now available on www.amazon.com and available through Barnes & Nobel on November 28. If you would like to order a signed copy contact The Forum Press at: www.theforumpress.com

Last month, President Obama spoke with a Dallas reporter about the federal budget and denied politics were in play against Texas when shuttles were awarded to other states.  Our President says he loves Texas, despite losing by approximately 10 points in the last presidential election and even professes “You better believe I’m not going not going to write off Texas … we’re going to compete” when discussing his reelection campaign for 2012.

So, riddle me this: Why was Texas’ federal disaster aid declaration request denied?

Wildfires have raged since November 2010 with over 2.3 million acres charred igniting 9,000+ wildfires across our great state. Two people have been killed and hundreds of homes burned to the ground. Texas families are losing their homes and their businesses and yet federal disaster aid is denied that could help citizens obtain low-interest loans and tax breaks to help with rebuilding.

Yes, everything is bigger in Texas and we are loud and proud on how we can take care of our own, but let’s put things in perspective. The Texas Forest Service says this of the current wildfire situation:

• Red flag warnings have been issued across much of West Texas today with critical fire weather conditions predicted.
• Texas Forest Service responded to two (2) large fires yesterday.
• We are currently working on seven (7) major fires that span 586,624 acres.
• 207 of the 254 Texas counties are reporting burn bans.

That’s 81% of Texas under a burn ban.

The criteria used by FEMA regarding federal disaster law is simple when evaluating a Governor’s request for a major disaster declaration.  As I read through the list provided by FEMA, it appears the Texas wildfires should have been approved for aid per the primary factors.

So, why was Texas denied when FEMA’s mission is to “support our citizens and first responders to ensure that as a nation we work together to build, sustain, and improve our capability to prepare for, protect against, respond to, recover from, and mitigate all hazards”?

And why hasn’t our President used his presidential authority to approve our request? After all, even children are taught that the President is the Chief of Government and the boss of every governmental worker by the U.S. Government Printing Office.

Big hat. No cattle.

Texas needs to appeal the denial and I still have hope President Obama will change his mind.  After all, he has reversed previous decision to deny disaster aid as in the case of Connecticut citizens affected by storms and floods last year. And our President has even approved the U.S. send cargo planes to Mexico to help fight fires.

Other states are provided federal aid for less damage and our federal government helps other countries, so Texans could still get federal assistance with cheap loans and tax breaks to help rebuild, right?!

Or, are personal politics being played by our President and his administration? Is Texas being punished like a child who talked back to their parent? So many questions.  So little time.

The weather outlook remains critical as our President arrives in Texas today to discuss immigration and attend a fundraiser for his 2012 reelection campaign in Austin.  The immigration speech will help reduce the amount his campaign has to reimburse the government for political travel to his fundraisers.  Good for him.

Maybe instead of asking Texans for money, he should tour the devastation first hand that will make him reconsider his previous denial.  And maybe those Texans contributing to his reelection campaign should help their own here:

Texas Department of Agriculture – STAR Fund

PK Firefighter Relief FundWest Texas Fire Relief Fund

West Texas Food Bank
Cattlewomen Care Texas Wildfire Relief Fund
American Red Cross

Even though our President and his administration do not feel “spreading the wealth” in Texas is warranted, please consider donating to one of the links listed above to help Texas in her time of need. Don’t leave it to someone else. You ARE someone else.

Thank you and God Bless Texas!

At the Thanksgiving dinner table we sat back, sated with turkey and all the fixins’. And as is our custom, we began reminiscing of times gone by, family members who have passed on, and others we’ve not seen for a time.

The discussion around the dinner table this year was no different. Over coffee and pie, we talked of old times, fond memories, laughter, wistfulness, future prospects, and hope mingled with thanks for our blessings, past, present and future.

The conversation turned to news of an elderly relative, a self-made man whose manner and behavior had changed markedly over the past few years. Now well into his years, this man had always been a rugged sort, a man of the earth who made a living by the sweat of his brow and the brawn of his muscle, tending his large farm and considerable holdings. His thriftiness is legendary among relatives and friends who joke that he still has his first dollar. He worked long hours from sun-up to sundown, so his financial conservatism was understandable and in many ways laudable.

He remains on the farm and today still maintains his independence, managing his land as well as the fruit of his lifelong labors — a sizeable portfolio accrued from decades of hard work, savings, and sensible investments.

Yet in the past few years, family members closest to him have noticed a change in him, something uncharacteristic of a man who was loathe to part with a dime unless it was for a necessary and sensible purpose. He had survived through many hard times — the Great Depression, WWII, Korea, Vietnam, the gas crisis and recession of the Carter years, and was especially careful with every dollar earned. So when it came to their attention that he was spending huge sums to pay off loans for some folks, buying automobiles for others, as well as other extraordinary expenditures, the family became concerned. They agreed that giving unto others was an admirable quality and that he had every right to disperse his fortune in whatever way he saw fit. But what concerned them were the sums he was spending. They grew alarmed that he might squander his hard-earned nest egg on frivolities and folks who didn’t deserve or warrant the benefit of his charity. And they were distressed that his spending of an exorbitant amount of money would lead him into bankruptcy.

Some family members who had worked the farm with our great-uncle, helping him grow it and tend it, also worried there might be little to be passed on to succeeding generations, especially those seated at the children’s table this Thanksgiving. So they convened a family meeting where it was suggested that our dear great-uncle, though still healthy and strong despite his advanced age, might be growing senile and incompetent in the conduct of his affairs. They decided to have him evaluated, understanding that if a judge rules him no longer competent to manage his affairs, steps will be taken through appropriate means to safeguard his assets and oversee his spending.

The competency hearing is scheduled for election day, November 2nd, 2010. Because you see, our uncle is your uncle too. His name is Sam. Uncle Sam. And not only our family, but millions more like ours across the country are concerned that Uncle Sam is no longer competent to conduct the affairs of this great nation. And the voters — the American family — will take charge of Uncle Sam and oversee his financial dealings because he is squandering our nation’s treasure to such an extent there soon will no longer be the American spirit, a legacy of the American dream to pass on from our founding fathers to posterity — our children and grandchildren.

We will be vigilant. We will conduct a follow-up evaluation of Uncle Sam in 2012.

To us lies the responsibility to safeguard the fortune of freedom for which “Uncle Sam” and so many Americans fought and died. To us has been given the duty to keep alive the promise of liberty given to us by previous generations for those who follow.

Ronald Reagan reminded us that freedom is a fragile thing and is never more than one generation away from extinction. It is not ours by inheritance; it must be fought for and defended constantly by each generation, for it comes only once to a people. Those who have known freedom and then lost it have never known it again.

As a family protects and safeguards its heritage for posterity so shall we, beginning on November 2, 2010. Our founders gave it all — their lives, their treasure, their sacred honor. We can do no less.